Singular Controls in an Inventory Management Model

E. Khmelnitsky (Israel)

Keywords

Inventory control, Reputation, State-costate dynamics

Abstract

This work addresses a problem of inventory control with
the reputation of a firm being a dynamic factor
influencing the distribution of future demand. The
analysis of the singularity of the optimality conditions
stated for the problem allows formulating some structural
properties of optimal dynamics of inventory and
reputation.